Tuesday, October 1, 2013

Convergence and Collision of ObamaCare and Government Costs
Everything That Rises Must Converge
Flannery O’Conner (1925-1964),  Title of Collection of Short Stories
Today two events occurred: ObamaCare rolled out and the government partially shut down. 
Given the convergence of colliding  philosophies of competing political parties and unsustainable entitlement costs,  a shutdown was inevitable.   Rising costs of ObamaCare and rising federal deficits were simply incompatible unless one side or another yielded or negotiated.  Government is about compromise, not refusing to negotiate.  
On one side, it was Hip Hip Hooray,  ObamaCare begins today.  After over 100 years of trying, scheming, and dreaming, advocates of big government and a social welfare nation had something to cheer about.
It came at the cost of a government shutdown, but that was all right.   The program protected the poor, the near poor,  and the sick.  It was affordable when one factored in tax increases. 

And it arrived at a time of public unpopularity.  Today's CNN poll indicates Americans opposed ObamaCare by 57% to 38%.
But at long last, ObamaCare put government in control of health care.   It supported the long held vision of universal care.  Indeed, it might be the path to single-payer.   It provided direct federal subsidies and controls for over  half of the nation’s population with its Medicare,  Medicaid,  and now Medicaid plus subsidies. 
The Medicaid plus subsidies segment will now support  health care costs for  the poor and  lower middle class who make less than $45,000 and who make up a large slice of Democratic constituencies.
On the other side are 156 million Americans  who now receive private coverage.  They  will  face rising  costs and fewer choices  But that too, is all right, for the law will shift costs to them,  health insurers, drug firms, and medical device makers and employers, many of whom  have had it too good for too long. They can afford to support the less fortunate.
Yes, these industries will  pass on costs of higher taxes, penalties, and regulations  to consumers, who will bear cost  burden of ObamaCare. Hospitals and doctors will  consolidate into quasi-monopolies to defend themselves against big government.   These monopolies drive up costs,  but “savings” achieved through accountable care  organizations, bundled billing, and new government-induced efficiencies will offset these costs.
Yes, many employers may go to private exchanges to they can replace existing plans with defined contributions.  Many may drop existing plans and switch people to the exchanges.  Others may reduce full-time employees to part-time work to avoid $2500 penalties for not covering each new worker.  Others, like the Cleveland Clinic, may cut thousands from their workforce.

Yes, there will be trade-offs and sacrifices.   As Winston Churchill explained at a White House luncheon,"The inherent vice  of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries."
But ObamaCare changes are the price of social progress.  These are steps one must take in to level the playing field, to rein in extravagant doctors and hospitals,  to show that the governing elite  knows what is best for ordinary middle and lower class citizens.
Once the public is hooked on generous government subsidies, which will be perceived by many as “free,” there will be no going back.  The time has come, say social welfare enthusiasts,  for the affluent effluent to pay their societal dues.   Higher taxes are the price of a civilized society.    
Members of the public are confused, bothered, and bewildered because they have been misinformed, even lied to, about government  generosity and compassion.  But now, now  they  will learn what is good for them, what they have been missing,  and what government can do for them – and to them.
Tweet:   Today 2 events occurred - ObamaCare rollout  and a government shutdown. This isn’t a coincidence. It’s  a  collision of costs and politics.

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